$9m to soothe heir's adieu

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Lachlan Murdoch's separation from News Corp, the company his father built into a colossus, will be sealed by a cheque that could exceed $US7 million ($A9.1 million).

Details of the Murdoch heir's farewell payment are contained in a share market filing that also reveals that as a continuing non-executive director of News he will retain executive share options and rights over shares in News Corp worth $US34 million ($A44.1 million) last year, and probably worth more now.

Lachlan Murdoch has also agreed to not set up in competition with his father's media empire for two years, and to "advise and consult" with News for the same period of time following last week's announcement that he will quit his executive role with News and return to Australia with his wife, Sarah, and son, Kalan.

His farewell cheque will be based on his salary and bonus for the year to June 30 just ended. It is expected to include a base payment that at least matches his $US1.8 million salary last year, and a profit-linked bonus that could be as much as $US7 million if earnings in the year to June 30 rise by more than 40 per cent.

The group's full-year profit will be announced next week, and if it holds the 17.5 per cent pace it was setting after three quarters, Lachlan's bonus will be between $US4 and $US5 million.

Few people will bank a bigger pay cheque this year — but one of them is Lachlan's father, Rupert. He received $US17.1 million last year, including a $US12.5 million bonus, and the new documents show his bonus could double to $US25 million if the group hits the 40 per cent-plus earnings growth target.

For the Murdochs, executive remuneration is not even the main game: through a family trust, they are jointly entitled to shares in News that are worth more than $A20 billion. The trust is half owned by Rupert, who has six children.

James, 32, the only sibling still working in the family business, is being eyed more closely as Rupert's possible heir. James deflected questions about succession yesterday in London, where he is chief executive of the News pay TV affiliate, BskyB. "My hope and my intention is to be here for the long term," he said.

The "Separation Arrangements" that News and Lachlan have signed off on stipulate that the man tipped until last week to succeed Rupert as head of News not engage for two years in any business "directly competitive" with any of News' businesses. Until the agreement expires, Lachlan probably will be quarantined from the industry he was raised to dominate.